Unaudited Financial Statements And Dividend Announcement For The First Quarter Ended 30 September 2016

Transcription

1 (Company Registration No E) (Incorporated in the Republic of Singapore) Unaudited Financial Statements And Dividend Announcement For The First Quarter Ended 30 September 2016 PART I - INFORMATION REQUIRED FOR ANNOUNCEMENTS OF QUARTERLY (Q1, Q2 & Q3), HALF-YEAR AND FULL YEAR RESULTS 1(a)(i) An income statement and statement of comprehensive income, or a statement of comprehensive income, for the group, together with a comparative statement for the corresponding period of the immediately preceding financial year. 3 Months Ended The Group 30 Sep Sep 2015 Change RMB 000 RMB 000 % Revenue 42,349 55,218 (23.3) Cost of sales (29,289) (41,099) (28.7) Gross profit 13,060 14,119 (7.5) Gross profit margin 30.8% 25.6% 5.2 ppt Other items of income Interest income (30.0) Other income (37.6) Other items of expenses Selling and distribution expenses (3,530) (757) Administrative expenses (6,911) (7,675) (9.9) Other operating expenses (856) (1,368) (37.4) Finance cost (34) (552) (93.8) Share of results of associate n/m Profit before income tax 2,436 4,668 (47.8) Income tax expense (1,930) (1,593) 21.2 Profit for the financial period 506 3,075 (83.5) Other comprehensive income - - Total comprehensive income for the financial period 506 3,075 (83.5) Profit attributable to: Owners of the company 506 3,075 (83.5) Total comprehensive income attributable to: Owners of the company 506 3,075 (83.5) 1

2 1(a)(ii) The following items (with appropriate breakdowns and explanations), if significant, must either be included in the income statement or in the notes to the income statement for the current financial period reported on and the corresponding period of the immediately preceding financial year. The Group s total comprehensive income for the financial period is derived after charging/(crediting): 3 Months Ended 30 Sep Sep 2015 Change RMB 000 RMB 000 % Amortisation of land use rights Amortisation of prepayments 5,604 13,759 (59.2) Depreciation of property, plant and equipment 1,903 2,509 (24.2) Depreciation of investment properties n/m Exchange (gain)/loss, net (18) (256) (93.0) Interest income (14) (20) (30.0) Interest expenses on bank loan (93.8) Government grants - (215) n/m Rental income (510) (299) 70.6 n/m not meaningful 2

3 1(b)(i) A statement of financial position (for the issuer and group), together with a comparative statement as at the end of the immediately preceding financial year. Non-current assets The Group The Company As at 30 As at 30 As at 30 As at 30 Sep 2016 Jun 2016 Sep 2016 Jun 2016 RMB 000 RMB 000 RMB 000 RMB 000 Property, plant and equipment 161, , Biological assets (1) 176, , Land use rights 23,879 24, Investment properties 29,953 30,356 Investments in subsidiaries , ,909 Investment in an associate 45,109 44, Intangible assets 2,550 2,700 - Long term deposit 4,679 4,626 4,679 4,626 Prepayments 338, , Deferred tax assets 2,005 2, , , , ,544 Current assets Biological assets (2) 7,380 7, Inventories 19,324 15, Trade receivables 31,702 26, Other receivables 168, , , ,421 Tax recoverable Cash and bank balances 26,938 11,143 16,239 6, , , , ,713 Less: Current liabilities Trade and other payables 21,726 14, ,036 Bank borrowings 1,439 1, Current income tax payable 2,646 3, ,811 19,761 2,006 2,283 Net current assets 227, , , ,430 Non-current liability Bank borrowings 1,857 1,943 1,857 1,943 Deferred tax liability 3,711 3, ,568 5,654 1,857 1,943 Net assets 1,007, , , ,031 Capital and reserves Share capital 322, , , ,346 Share-based payment reserve 2,016 2,016 2,016 2,016 Statutory reserve 71,135 71, Accumulated profits/(loss) 611, ,461 1,106 1,669 Total equity 1,007, , , ,031 (1) This represents eucalyptus trees, moso bamboo trees and bamboo shoots owned by the Group. (2) This represents synthetic logs of shiitake mushroom held by the Group. 3

4 (b)(ii) Aggregate amount of group s borrowings and debt securities. Amount repayable in one year or less, or on demand As at 30 September 2016 As at 30 September 2015 Secured Unsecured Secured Unsecured RMB1,439,000 Nil RMB42,000,000 Nil Amount repayable after one year As at 30 September 2016 As at 30 September 2015 Secured Unsecured Secured Unsecured RMB1,857,000 Nil Nil Nil Details of any collateral The Company s wholly-owned subsidiary, Wangcheng Foods Development Co., Ltd. ( Wangcheng ), has credit facilities (the Facilities ) up to an aggregate principal amount of RMB17 million granted by Postal Savings Bank of China (the Bank ). Wangcheng has pledged its buildings and land use rights as collateral for the Facilities in favour of the Bank. The Executive Chairman and Chief Executive Officer (the CEO ) of the Company and his wife have jointly and severally provided a personal guarantor for the facility offered by Postal Savings Bank of China. In addition, the Company has taken a mortgage loan of S$1,322,154 granted by Hong Leong Finance to finance the acquisition of an office unit in Singapore. The loan tenure is 15 years. As at end of the financial period, the Company has drawn down an aggregate loan amount of S$495,807. As at 30 September 2016, the Group s outstanding loan amount was approximately RMB3,296,000 of which RMB1,439,000 are repayable within 1 year and the rest of the loan amount are repayable after 1 year. 4

5 1(c) A statement of cash flows (for the group), together with a comparative statement for the corresponding period of the immediately preceding financial year. 3 Months Ended The Group 30 Sep Sep 2015 RMB 000 RMB 000 Cash flows from operating activities Profit before income tax 2,436 4,668 Adjustments for: Depreciation 2,306 2,509 Amortisation of land use rights Amortisation of intangible assets Amortisation of prepayments 5,604 13,759 Interest income (14) (20) Interest expenses Share of results of associate (143) - Operating cash flows before working capital changes 10,508 21,603 Working capital changes: Inventories (3,856) 2,562 Trade and other receivables (15,546) (34,614) Trade and other payables 7,112 (2,194) Cash generated from operations (1,782) (12,643) Interest received Income taxes paid (2,918) (3,496) Net cash used in operating activities (4,686) (16,119) 5

6 1(c) A statement of cash flows (for the group), together with a comparative statement for the corresponding period of the immediately preceding financial year (Continue): 3 Months Ended The Group 30 Sep Sep 2015 RMB 000 RMB 000 Cash flows from investing activities Purchase of property, plant and equipment (189) (1,616) Proceeds from termination of prepaid lease for mushroom - 12,744 farmland Prepaid lease for bamboo plantations - (3,470) Net cash (used in)/ generated from investing activities (189) 7,658 Cash flows from financing activities Issue of ordinary shares 20,864 80,256 Proceeds from bank borrowings - 17,000 Repayments of bank borrowings (160) (17,000) Interest paid (34) (552) Net cash generated from financing activities Net changes in cash and bank balances 20,670 79,704 15,795 71,243 Cash and bank balances at beginning of the financial period 11,143 27,440 Cash and bank balances at end of the financial period 26,938 98,683 6

7 1(d)(i) A statement (for the issuer and group) showing either (i) all changes in equity or (ii)changes in equity other than those arising from capitalisation issues and distributions to shareholders, together with a comparative statement for the corresponding period of the immediately preceding financial year. Attributable to owners of the parent The Group Share capital Sharebased payment reserve Statutory reserve Accumulated profits Total equity RMB 000 RMB 000 RMB 000 RMB 000 RMB 000 Balance as at ,346 2,016 71, , ,958 Profit for the financial period, representing total comprehensive income for the financial period Contributions by and distributions to owners of the Company Issue of ordinary shares 20, ,864 Total contributions by and distributions to owners of the Company 20, ,864 Balance as at ,210 2,016 71, ,967 1,007,328 Balance as at ,090 2,016 65, , ,513 Profit for the financial period, representing total comprehensive income for the financial period ,075 3,075 Contributions by and distributions to owners of the Company Issue of ordinary shares 80, ,256 Total contributions by and distributions to owners of the Company 80, ,256 Balance as at ,346 2,016 65, , ,844 7

8 The Company Share capital Sharebased payment reserve Accumulated profits/(losses) Total equity RMB 000 RMB 000 RMB 000 RMB 000 Balance as at ,346 2,016 1, ,031 Loss for the financial period representing total comprehensive income for the financial period - - (563) (563) Contributions by and distributions to owners of the parent Issue of ordinary shares 20, ,864 Total contributions by and distributions to owners of the parent 20, ,864 Balance as at ,210 2,016 1, ,332 Balance as at ,090 2,016 5, ,326 Loss for the financial period representing total comprehensive income for the financial period - - (698) (698) Contributions by and distributions to owners of the parent Issue of ordinary shares 80, ,256 Total contributions by and distributions to owners of the parent 80, ,256 Balance as at ,346 2,016 4, ,884 8

9 1(d)(ii) Details of any changes in the company's share capital arising from rights issue, bonus issue, share buy-backs, exercise of share options or warrants, conversion of other issues of equity securities, issue of shares for cash or as consideration for acquisition or for any other purpose since the end of the previous period reported on. State also the number of shares that may be issued on conversion of all the outstanding convertibles, as well as the number of shares held as treasury shares, if any, against the total number of issued shares excluding treasury shares of the issuer, as at the end of the current financial period reported on and as at the end of the corresponding period of the immediately preceding financial year. During the financial period, the Company completed a placement on 27 July After the completion of the placement, the company has allotted and issued 14,598,013 new ordinary shares at S$ each placement share. These new shares have been listed and quoted on the Singapore Exchange Securities Trading Limited and rank pari passu in all respects with the existing shares of the Company. Pursuant to the above issue and allotment of the new ordinary shares, the number of issued and paid-up shares in the capital of the Company increased from 162, ordinary shares to 176,798,164 ordinary shares. There were no outstanding convertibles or treasury shares held as at 30 September 2016 and 30 September (d)(iii) To show the total number of issued shares excluding treasury shares as at the end of the current financial period and as at the end of the immediately preceding year. Total number of issued shares (excluding treasury shares) As at 30 June ,200,151 Issue of ordinary shares 14,598,013 As at 30 September ,798,164 1(d)(iv) A statement showing all sales, transfers, disposal, cancellation and/or use of treasury shares as at the end of the current financial period reported on. Not applicable. 2. Whether the figures have been audited or reviewed and in accordance with which auditing standard or practice. The figures have not been audited or reviewed by the Company s auditors. 3. Where the figures have been audited or reviewed, the auditors report (including any qualifications or emphasis of a matter). Not applicable. 4. Whether the same accounting policies and methods of computation as in the issuer s most recently audited annual financial statements have been applied. The accounting policies and methods of computation applied by the Group are consistent with those used in its most recently audited financial statements for the financial year ended 30 June

10 5. If there are any changes in the accounting policies and methods of computation, including any required by an accounting standard, what has changed, as well as the reasons for, and the effect of, the change. Not applicable. 6. Earnings per ordinary share of the group for the current financial period reported on and the corresponding period of the immediately preceding financial year, after deducting any provision for preference dividends. 3 Months Ended 30 Sep Sep 2015 The Group Earnings per share (RMB cents) - basic diluted Weighted average number of ordinary shares ( 000) - basic 141, ,580 Weighted average number of ordinary shares ( 000) - diluted 141, ,580 Basic earnings per share are calculated by dividing the net profit after tax attributable to equity holders of the Company of the respective periods and the weighted average number of shares in issue during the respective financial periods. The weighted average number of ordinary shares represents the number of ordinary shares at the beginning of the financial period, adjusted for new ordinary shares issued during the financial period, multiplied by a time-weighted factor. Diluted earnings per share are calculated by dividing the profit attributable to equity holders of the Company for the respective periods and the weighted average number of shares, adjusted for the effects of all dilutive potential ordinary shares. Comparative basic and diluted earnings per share have been adjusted to reflect the effect of share consolidation which was completed in November Net asset value (for the issuer and group) per ordinary share based on the total number of issued shares excluding treasury shares of the issuer at the end of the:- (a) current financial period reported on; and (b) immediately preceding financial year. The Group As at 30 Sep 2016 As at 30 Sep 2015 Net asset value per share (RMB cents) Number of ordinary shares ( 000) 176, ,001 The Company As at 30 Sep 2016 As at 30 Sep 2015 Net asset value per share (RMB cents) Number of ordinary shares ( 000) 176, ,001 Number of ordinary shares as at 30 September 2016 had taken into account the share consolidation of 5 existing shares into 1 share which was completed in November

11 8. A review of the performance of the group, to the extent necessary for a reasonable understanding of the group s business. It must include a discussion of the following:- (a) any significant factors that affected the turnover, costs, and earnings of the group for the current financial period reported on, including (where applicable) seasonal or cyclical factors; and (b) any material factors that affected the cash flow, working capital, assets or liabilities of the group during the current financial period reported on. STATEMENT OF COMPREHENSIVE INCOME Review of performance for the first quarter ended 30 September 2016( 1Q2017 ) Revenue Our revenue declined by approximately RMB12.9 million or 23.3% to approximately RMB42.3 million in 1Q2017, from approximately RMB55.2 million for the quarter ended 30 September 2015 ( 1Q2016 ). The revenue derived from sales of processed food products and moso bamboo trees in 1Q2017. Sales of our moso bamboo trees was approximately RMB5.7 million, decreased by approximately RMB9.7 million in 1Q2017 from approximately RMB15.4 million in 1Q2016. There were approximately 12,340 tonnes of moso bamboo trees harvested and sold in 1Q2017 compared to 32,130 tons in 1Q2016. This was primarily due to a smaller order quantity of moso bamboo trees placed by our customers in 1Q2017 based on their needs for the bamboo trees during the period. Sales of our processed food products was approximately RMB36.6 million in 1Q2017, decreased by approximately RMB3.2 million or 8.0 % from approximately RM39.8 million in 1Q2016. This was mainly because we ceased to produce and sell processed mushrooms in the domestic markets owing to an increase in cost of raw material of processed mushrooms without corresponding increases in the average selling price of the processed mushrooms. On the other hand, we have reallocated part of the production capacity to our new dietary fibre food products since the second half of the last financial year. Sales of the new processed food products accounted for about 10% of the total revenue of the processed food segment in 1Q2017. Gross profit and gross profit margin Our gross profit decreased by approximately RMB1.0 million or 7.5% to approximately RMB13.1 million in 1Q2017, from approximately RMB14.1 million in 1Q2016. The overall gross profit margin rose to 30.8% in 1Q2017 from 25.6% in 1Q2016. The gross profit margin of our bamboo business remained almost constant at 21.1% in 1Q2017 compared to 21.6% in 1Q2016. The gross profit margin of our processed food product business segment increased to 32.4% in 1Q2017 from 27.1% in 1Q2016, mainly due to changes in product mix. In addition, we have adjusted our sales and production strategy in local market for our processed food segment that we reduced the production and sales quantity of the low margin products and increased the dietary firbre food products which have higher profit margin. 11

12 Other operating income Other operating income of approximately RMB0.6 million in 1Q2017 comprised of interest income, rental income, foreign currency exchange gain and other miscellaneous income. We received rental income of approximately RMB0.5 million in this quarter from leasing spare space of office and plants in our subsidiaries to external parties. In addition, there was a net foreign currency exchange gain from the US Dollar denominated sales, as a result of appreciation of the US Dollar against Renminbi in 1Q2016. Operating expenses Selling and distribution expenses increased to approximately RMB3.5 million in 1Q2017 from RMB0.8 million in 1Q2016. The increase was mainly due to progressive payments made for producing and hosting our e-commerce platform, commission paid to distributors, advertising to publicise our new dietary fibre food products and appointing marketing experts to assist in planning and implementing marketing strategy for the new processed food products. Administrative expenses decreased by approximately RMB0.8 million or 9.9% to approximately RMB6.9 million in 1Q2017, from approximately RMB7.7 million in 1Q2016. It mainly arose from lower depreciation of mushroom tents in this quarter after the disposal of part of our mushroom tents in the previous year. In addition, there were lower staff costs incurred by our cultivating business of shiitake mushroom after scaling back our mushroom farmland. Other operating expenses was approximately RMB0.9 million in 1Q2017, decreased by approximately RMB0.5 million or 37.4% from approximately RMB1.4 million in 1Q2016. The expenses was primarily maintenance costs of eucalyptus plantations and other miscellaneous expenses. Share of results of associate The Group s share of results of associate for 1Q2017 of approximately RMB0.1 million relates to Fujian Tianwang Foods Co., Limited ( Tianwang ), which we own 45% of its shareholding. Tianwang s source of revenue in 1Q2017 was generated mainly from production and supply of processed vegetables, including processed bamboo shoots Finance cost The bank borrowings decreased from RMB42.0 million in 1Q2016 to approximately RMB3.3 million in 1Q2017 after repayments of bank loans. Therefore, the finance cost declined to less than RMB0.1 million in 1Q2017, from approximately RMB0.6 million in 1Q2016. Income tax expenses Our income tax expense was approximately RMB1.9 million in 1Q2017 compared to approximately RMB1.6 million in 1Q2016. This was because most of our earnings in 1Q2017 derived from our processed food segment which are subject to the Enterprise Income Tax at the rate of 25%. In 1Q2016, there was higher earnings contributed from our cultivation business segment which is exempt from the Enterprise Income Tax and the value-added tax. The effective tax rate is approximately 79.2% in 1Q2017. Total comprehensive income for the period Total comprehensive income for the period under review decreased by approximately RMB2.6 million to approximately RMB0.5 million in 1Q2017, from approximately RMB3.1 million in 1Q2016. The decrease was mainly due to lower sales and higher operating expenses during the current financial period. 12

13 STATEMENT OF FINANCIAL POSITION Our non-current assets decreased by approximately RMB4.9 million or 0.6% to RMB784.9 million as at 30 September 2016, from RMB789.8 million as at 30 June The decrease was mainly due to amortisation and depreciation of non-current assets incurred in 1Q2017. Our current assets increased by approximately RMB32.2 million or 14.5% to RMB253.8 million as at 30 September 2016, from RMB221.6 million as at 30 June It was mostly attributable to an increase in cash and bank balances arising from the net proceeds received from share placement. In addition, the trade and other receivables also increased, mainly as a result of increases in prepaid maintenance costs for bamboo plantations, trade debtors and advances to suppliers of raw materials, including for the acquisiton of mushroom synthetic logs. The inventories were also higher in 1Q2017 due to larger quantity of finished goods stored, which will be exported to our Japanese market in the next quarter. Our current liabilities increased by approximately RMB6.0 million or 30.6% to approximately RMB25.8 million as at 30 September 2016, from approximately RMB19.8 million as at 30 June The increase mainly arose from increased advances from our customers and higher trade payables. Our capital and reserves increased by approximately RMB21.4 million or 2.2%, from RMB986.0 million as at 30 June 2016 to approximately RMB1.0 billion as at 30 September 2016, mainly as a result of the issue of new ordinary shares arising from the placement which was completed in July 2016, and retention of net profits. STATEMENT OF CASH FLOWS 1Q2017 For the three months ended 30 September 2016, we recorded net cash used in operating activities of approximately RMB4.7 million. This comprised of cash generated from operating activities before changes in working capital of RMB10.5 million, working capital outflow of RMB12.3 million, and net cash outflow amounting to RMB2.9 million from interest income received and income tax paid. The net working capital outflow mainly arose from an increase in trade receivables, additional prepayments for maintenance of our bamboo plantations and increased advances to suppliers of raw materials. Net cash of approximately RMB0.2 million was used in investing activities, mainly attributable to increased investment in property, plant and equipment. Net cash flow generated from financing activities was approximately RMB20.7 million. It was mostly due to the net proceeds received from the share placement which was completed in July The amount was partly offset by repayments of bank loan and interest expenses paid for bank borrowings. 9. Where a forecast, or a prospect statement, has been previously disclosed to shareholders, any variance between it and the actual results. Not applicable. 13

14 10. A commentary at the date of the announcement of the significant trends and competitive conditions of the industry in which the group operates and any known factors or events that may affect the group in the next reporting period and the next 12 months. Amid challenging operating environment in China, we will continue to focus on our fundamental business and cautiously proceed with our business development. Our shiitake mushroom harvesting season will commence in the next quarter, we will harvest shiitake mushrooms from 1,184* mu mushroom farmland. In addition, we expect to continue to harvest bamboo products from our moso bamboo plantations until the fourth quarter of this financial year. For our processed food segment, we will continue to step up our effort in promoting sales of our konjac-based dietary food products through our e-commerce platform. The e- commerce platform is also utilised as a media to advertise and publicise the products in order to increase consumer awareness. In the face of slowdown in the economy in China, the management will continue to closely monitor the Group s operations. *1 mu is equivalent to approximately 667 square metres 11. (a) Current Financial Period Reported On Any dividend declared for the current financial period reported on? No (b) Corresponding Period of the Immediately Preceding Financial Year Any dividend declared for the corresponding period of the immediately preceding financial year? No (c) Date payable Not applicable (d) Books closure date Not applicable 12. If no dividend has been declared/recommended, a statement to that effect. Not applicable. 13. If the group has obtained a general mandate from shareholders for IPTs, the aggregate value of such transactions as required under Rule 920(1)(a)(ii). If no IPT mandate has been obtained, a statement to that effect. There has been no interested person transactions during the three months and financial year ended 30 September The Group does not have a general mandate pursuant to Rule 920(1)(a)(ii). 14

15 14. Update of Use of Proceeds of Share Placement Net proceeds of approximately RMB20.9 million (approximately S$4.2 million) was raised from the share placement which was completed in July Part of the net proceeds amounting to approximately S$2.0 million had been utilised as annouced on 5 October Negative Confirmation Pursuant To Rule 705(5) The Board of Directors of Yamada Green Resources Limited (the Company ), do hereby confirm that, to the best of its knowledge, nothing has come to the attention of the Board of Directors of the Company which may render the financial statements for the first quarter ended 30 September 2016 to be false or misleading in any material aspect. 16. Confirmation that the issue has procured undertakings from all its directors and executive officers pursuant to Rule 720(1) of the SGX Listing Manual. The Company confirms that it has procured undertakings from all its Directors and Executive Officers (in the format set out in Appendix 7.7) pursuant to Rule 720(1) of the SGX Listing Manual. BY ORDER OF THE BOARD Chen Qiuhai Executive Chairman and CEO 28 October